Tag Archives: banks

Charlotte Farrell, Parliamentary Candidate for High Peak and candidate for Hope Valley in the Local Elections says…

To date I’ve attended five hustings, and at each the questions about the economy and austerity come up. The other 4 parties all talk about the need for growth to get us out of austerity. They say that with better economic growth the country will once again be able to start spending and austerity will come to an end. Every time, I make the point that we cannot have infinite growth in a finite world and that we need to rethink our whole economic plan. However, it feels as if my words fall into a void and nobody quite hears them.

I am never picked up on what I say, though I would dearly like to expound on why continued growth is bad; it’s as if there is a conspiracy not to validate mine or the Green Party’s position generally by asking the serious questions that arise from it.

Of course this may be the truth. It seems so blindingly obvious that we cannot continue to grow in the manner we are doing. Whereby the world’s population (and by that I mean the population of the wealthiest countries) continues to use more each year in terms of raw materials than the planet can replace in that time, and to throw out more waste, atmospheric and real, than the planet can deal with in the same time frame.

It seems that the other parties have no answer for this conundrum; but rather than admit it (or better still work towards finding an answer) they choose to ignore it altogether. Ostrich like, they cover their ears in the hope it will go away.

I am not denying that all of the parties recognise some need to avert climate change (except UKIP who seemingly do not believe in it); and that even under the coalition there has been some increase in renewable energy consumption, but until they address the fundamental issue of growth, their attempts will not be enough to avert global economic, environmental and social disaster.

I have always struggled with maths and so never bothered with economics. I thought it was just something for those much more intelligent than I, but now I realise that most politicians also don’t understand economics. What they do is support the existing system, either because they’re devoid of ideas for anything better, or to protect their own vested interests.

Under the present system we have to keep growing. That is because if we base our economy on debt, as is the case (97% of all “money” in circulation was originally created by the high street banks as debt); to create sufficient to pay it back (not to mention the interest) we have to produce more. And so it fuels a vicious circle.

Of course it’s difficult and unpopular to challenge the status quo and that is the reason the Green Party is constantly derided by the media, but sooner or later politicians are going to have to face up to the ‘elephant in the room’ – the question of infinite growth in a finite world.

If we’re going to exist within the limits of what our one planet can give us then one of the first things we need to accept is that there needs to be a redistribution of wealth. If we don’t have growth, then that which we have has to be shared a lot more equally than it currently is, both globally and nationally.

Again, our debt-based monetary system predicates against this. In a debt based economy the poor acquire more debt simply to live, while the rich, who do not need to borrow, acquire the benefit through tangible assets such as property, stocks and shares and the other trappings of privilege.

I believe that it will be hard to reach the kind of steady state economy we need while wedded to the old monetary system. How can something as fundamental as the creation of money, be left in the hands of those who profit most from its production? The banking system has failed us, but rather than think about a better way, we simply tinker at the edges and let it continue largely unmolested.

The Green Party wants to see money creation removed from the banks and given back to state control. This in fact used to be the case until computers did away with the need for there always to be a tangible real bit of money on the other side of the debt. Under the Green Party’s plans the National Monetary Authority would control the production of money, issuing it as and when needed straight into the real economy. It would be used (amongst other things) to build houses, schools, hospitals and railways etc and as these were built the money would filter down through the workers’ pay into the local economy.

I admit its difficult looking at things from the present position to see how we would get to that state or how we would achieve this; but that in itself is no reason not to work towards finding a way.

The destruction of the planet and our economic system go hand in hand. We desperately need to change both before its too late. If nothing else, I hope that with Green Party candidates standing in 90% of parliamentary seats this message gets across loud and clear, so long as it does, I won’t mind how often the media chose to mock us because ultimately I believe we will be heard.

Last weekend, Governor of the Bank of England, Mark Carney made the most important political statement of the year. Speaking at a World Bank seminar in New York, Carney said: the “vast majority of reserves are un-burnable”. He was referring to fossil fuels, he was speaking to financiers and industrialists.

Carney is no liberal Green giant, he is a very conservative minded Canadian who encouraged the exploitation of his country’s tar sands, about the dirtiest fuel in the world. Yet he has had to swallow a dose of reality and accept the warnings of Nicolas Stern about the full impact of climate change on global finance. He has at last accepted the dangers of putting too many of our economic eggs into the oil basket.

In the spring of 2012, I wrote an article called ‘The Carbon Bubble’, published on the DGP website. [ https://derbyshiregreenparty.org.uk/2012/03/17/the-carbon-bubble/ ] That article showed that a huge amount of global wealth is invested in oil and gas reserves. If these reserves are burned, as they have to be to give a return on the investment, then global temperatures will rise to between 3.5 & 5.0 degrees C. If the wealth invested in coal is added in, then the planet becomes uninhabitable.

At that time investors continued to pour their wealth in to fossil reserves. We are still seeing that in the UK over fracking. The rich and powerful individuals and organisations making these investments fully expect a return. For them to stay rich, the world must fry.

This is the problem that financiers and politicians of all shades except Green have allowed to happen. If the carbon reserves are not burned, to keep temperature rise to below 2C, colossal amounts of private and corporate wealth will be lost, markets will crash, the Carbon Bubble bursts, unleashing a financial crisis that would dwarf that of 2008. If the reserves are burned to return the expected profit and wealth, then the cost of the resulting climate chaos will be far greater than the value of the reserves, the economy will be bankrupt.

Carney’s predecessor at the BoE, the ever cautious Mervyn King, recognised that the warnings about over investment in carbon assets by the Stock Exchange needed due consideration. The new Governor has indeed considered the matter and is issuing his quiet warnings to the market. Is it a coincidence that the markets have dipped this week? Is the move to divestment in coal, gas and oil really so altruistic? Are we seeing a steady retreat from carbon assets as the reality of climate change begins to penetrate the minds of corporate investors? If so this will create its own problems.

Where will the wealth go? If it is pulled out of oil and gas, it will be looking for a home. Is this the real reason for the drive for privatisation of public service. Not an ideologically driven policy at all, but a pragmatic response to the need to find a safe haven for private and corporate wealth. What could be a better long term investment than the supply of food, water and health? These are what everyone in the world needs on a daily basis, just like energy but on a far bigger scale. Hand all of this supply to the private sector and the potential market is huge and growing.

Greens oppose this commercialisation of the basic needs of people. For us, the supply of the essentials of life, food, water, energy, health and education, should be under public democratic control so access is not determined by personal wealth, but by need. Hand this supply over to the private sector then it will be driven by profit, not the needs of the consumers. Many will be priced out of the market in these services so that the rich and powerful can maintain their privileged positions.

Have you ever wondered why the world’s economy is in such a mess? Whether, as we keep being told, perpetual growth is actually essential, or even a good thing? Would you like to know more about what a local currency might look like? Or what Steady State Economics or Participatory Budgeting are? Wonder no more!

Derbyshire Green Party member Ian Wood will be the keynote speaker at this event organized by Transition Buxton. www.transitionbuxton.co.uk

All are welcome to attend the seminar, to listen to the expert speakers, take part in practical workshops and to explore how things might be done differently in the High Peak.

The seminar is FREE, but Transition Buxton will be happy to accept donations towards their costs. They will provide tea or coffee, plus soup and a roll at lunchtime – there will be a ‘bring and share’ buffet spread.

For more information or to book a place contact Charles or call 07769 627133.

Green Party leader Caroline Lucas MP will this week tell the coalition government there is “no good reason for any cuts in public expenditure during the life of this parliament.”

On Monday 21 June Britain’s first Green MP is to issue a new report – Cuts: the callous con trick (1) – in which she will make the case that cuts are unnecessary “because the economy could instead be rebalanced using additional tax revenues.”

The report, written jointly with tax expert Richard Murphy and Colin Hines of Finance for the Future, condemns the government “for failing to put to the electorate the option of fair tax instead of cuts,” and accuses ministers of increasing the likelihood of a double-dip recession.

Cuts “are not an economic inevitability but an ideological choice”

Caroline Lucas said today:

“Cuts are not an economic inevitability. They are an ideological choice. Politicians of all parties are now sharpening their axes to slash public spending, forcing those on lower incomes, who depend on public services the most, to pay the highest price for the recent excesses of the bankers.

“There is a choice. We should ask those best able to pay to foot the bill through fairer taxation. That’s the challenge I’m issuing: for that political choice to be made. It must be clearly asserted that we are not all in this together: that some had more responsibility for this crisis than others, and some benefited more from the boom that preceded it. Those who enjoyed the largest benefits must pay up now. For that to happen, fair taxes, not cuts, must become the new big idea to replace today’s callous and uncaring cuts fanaticism.”

Tax avoidance and evasion “truly staggering” – could be as high as £100bn a year

The Brighton Pavilion MP continued:

“The UK is currently one of the most unequal societies in Europe. But the financial crisis offers us an opportunity to rebalance the tax system. We could do it, for example, by applying the 50% tax rate to incomes above £100,000, abolishing the upper limit for national insurance contributions, raising capital gains tax to the recipient’s highest income tax rate, and helping lower earners by reintroducing the 10% tax band.

“Moreover, the huge extent of tax avoidance, tax evasion and unpaid tax in the UK economy is truly staggering. HM Revenue & Customs themselves admit that tax evasion and avoidance together come to at least £40 billion a year, whilst in November 2009 they also admitted there was £28 billion of unpaid tax owing to them. Shocking as these numbers are, some experts have suggested that tax evasion – that’s deliberately breaking the law to not pay tax – might be as high as £70 billion a year, and tax avoidance – in other words, exploiting loopholes in tax law – might be £25 billion a year. That would take the total target for necessary action to collect tax due and owing to more than £100 billion a year”

Cut tax abuse, not tax-collectors’ jobs

Caroline Lucas continued:

“Whilst these appalling losses to the nation’s coffers are occurring, HM Revenue & Customs are pursuing a programme of job cuts which will ultimately reduce their own staff by 20,000 – close to one quarter of the total. This makes absolutely no sense. This programme should be reversed, staff re-employed, and local tax offices re-opened in order to tackle tax abuse. It has been calculated that at least £15 billion of extra tax could be collected each year as a result. That could prevent a massive range of cuts.”

“Our report sets out a range of additional options for changing the tax rules for the UK so that more than £40 billion of additional taxes could be raised each year by the end of the life of this parliament. That, together with the tax collecting efficiency savings already noted, would together deliver more than £60 billion of tax revenues for the UK – so preventing the need for any cuts at all.”

Richard Murphy added:

“A government really can spend to save the economy when in a recession. During this one, borrowing has been smaller and unemployment lower than forecast because of the measures taken by the last government to stimulate the economy. This report argues that a Green New Deal involving public and private investment in a massive labour intensive UK wide energy saving programme and a rapid shift to renewables should be the basis for continuing that programme of support for our economy. This would ensure that we come out of the recession better equipped for the future we’re going to face.”

Caroline Lucas concluded:

“Fairer tax not cuts must become the real battleground of this new Parliament. It is the debate the Coalition and Labour alike must embrace. As the full ghastliness and unfairness of the cuts become ever clearer, the public clamour for fairer taxes rather than cuts can only grow.”

Like this:

High Peak Green Party candidate Peter Allen has spoken out against the lack of substance in the recent ‘Chancellors’ TV debate, involving Alistair Darling, George Osbourne and Vince Cable.

“Their performance exposed the lack of real choice being offered by the three establishment parties. In the coming election, the Green Party will highlight the need to defend public services, control the activity of the banks and to increase taxation of the wealthy.”

The Greens found the budget similarly disappointing. Our leader Caroline Lucas, called it,

“a missed opportunity to put fairness and sustainability at the centre of Britain’s recovery plans.”

We were also critical of the lack of commitment to protect spending on social housing or public transport, two important issues that Peter is focussing on in his campaign.

“After 13 years of a Labour Government, inequality has grown, irresponsible bankers have been allowed to wreck the economy, and the services the rest of us rely on are under attack,” says Peter.

Peter and his team have been campaigning across the High Peak, and we are enjoying the official start of the campaign.

“We have a programme that is a practical and realistic plan to move towards a more equal society, protect public services, and fight climate change”

Our manifesto will include a costed commitment to an immediate nationwide programme to insulate homes. This would dramatically reduce energy consumption and greenhouse gas emissions while creating 350,000 training places within a year for the unemployed. It also includes a costed commitment to a Retirement Pension of £170 pw.

The Labour government has learned nothing from the global financial crisis. In thrall to the banks, and behaving as if the UK itself is an offshore banking haven like the Cayman Islands or Jersey, this bankrupt government still cannot bring itself to regulate the banks properly. As a result, the City has returned to business as usual, which is a huge risk for the mass of the British population whose current and savings accounts are still tied up with the banks’ casino-style speculation. Green Party policy is for the banks to be broken up so that they are no longer too big to fail, so that the public purse is not ransacked next time their senseless and harmful gambling spirals out of control.

The Green Party demands a fundamental change to the way money is created. Instead of commercial banks being handed the right to create 97% of the money supply (see references below) and then charging interest to lend it to the public, the creation of money should be taken back in house by the Bank of England. Our money should then be invested in projects which benefit society and the environment, consider contacting an accountant in Loveland to see your options. The bank bailouts have given the lie to the argument that public money is not available – it just needs to be channelled into public investment instead of private profit.

The Green Party supports the Robin Hood tax campaign at http://robinhoodtax.org.uk/ and resolves to include a financial transactions tax in its 2010 general election manifesto.

The Green Party re-emphasises its commitment to a fairer society both in the UK and globally.

The Robin Hood Tax differs fundamentally from James Tobin’s original concept as its principal motivation is the raising of revenue as opposed to being a way of regulating speculative financial activity.

James Tobin first proposed his tax in the 1970s as a way of ‘throwing sand in the wheels’ of currency markets rather than harnessing their extraordinary volumes as a means of generating income. More recently the idea of a wider Financial Transactions Tax covering the full range of products traded in the financial markets, has gained ground. Even levied at a very low rate, a yield of $400 billion a year could be realised.

The media as a means of shorthand refer to the Financial Transaction Tax as the Tobin Tax. In fact, Tobin made his proposal specifically about currency transactions. When he made his proposal 30 years ago, the foreign exchange market had a daily value of $18 billion. The market is now worth more than $3,000 billion per day. Tobin’s proposal was for a 1% levy, 200 times the rate the Robin Hood Tax campaign is proposing for the taxing of foreign exchange. The purpose of his tax was to impede daily currency trading and to discourage speculative activity, not as we propose to be a means of raising new revenue to fight poverty, at home and abroad.

The Robin Hood Tax differs markedly from the Tobin tax in that it is born of a different time, proposed at a different rate and designed for a different purpose.